Investment Info:

Single-family residence buy & hold investment in Clarksville.

Purchase price: $56,000
Cash invested: $56,000

This will be a BRRRR property, we purchased it for $56k, invested $22k on the rehab, and will rent for $1,000-1,050 per month. The ARV will be $130k and we'll refinance into a 30yr fixed mortgage after the 6-month seasoning period. We will actually pull out $97,500 with the refi (130,000 x 75% LTV). That means we'll be pulling out $19,500 more than we initially invested!

What made you interested in investing in this type of deal?

This deal penciled out great, and it is in a neighborhood that we love to buy in.

How did you find this deal and how did you negotiate it?

Our painter brought us this deal, while not the first one he has brought us, it is the first one that we were able to purchase. The sellers had already spoken with another investor who also wrote them an offer. We took the time to build rapport with the sellers, we listened to their needs, I think that made all the difference, and ultimately why they chose us. They also left us two great reviews on our Sperzel Properties Facebook page!

How did you finance this deal?

Our own cash.

How did you add value to the deal?

We converted an upstairs laundry room back into a bedroom, we finished a large area in the basement to create an extra family space, and we enclosed the original carport creating a one car garage.

What was the outcome?

Overall we are pleased with the numbers, and they came out pretty close to our projections. The biggest surprise was finding out that the "minor repairs" our inspector noted about the roof ended up resulting in an entire replacement roof. That overage put us over budget by $5,500. Our tenant moved in on 4/29/19.

Lessons learned? Challenges?

Get a second opinion anytime an inspector notes a repair may be needed on a major item such as a roof. We likely could have negotiated a better purchase price before closing. Also, always ask sellers to write you a testimonial on any public business page you might have and build your credibility!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We utilized a local Title company, and I would highly recommend Allen and Drew Hoffer at WT&S Title in New Albany, Indiana.